Mike Jacobs is planning to lease an automobile. in an effort to minimize the price of the vehicle being leased, mike should compare the capitalized cost at different leasing companies.
Capitalized costs are costs that are added to the fixed asset cost base on the company's balance sheet. Capitalized costs are incurred for the construction or acquisition of property, plant and equipment. Capitalized costs are recognized over time through depreciation or amortization rather than being recognized as an expense in the period in which they are incurred.
Sum the direct costs, maintenance costs, and all gross interest for a loan for a specific period to get the final cost. Four. Subtract the final profit from the final cost to get the capitalized cost of a given transaction for a given time period.
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